A serious man for serious times was the pose, and it was the shrewdest option available for David Cameron in Birmingham. Like Gordon Brown in 2008 – "this is no time for a novice" – as the one at the helm while the economy has taken a fresh dive, the prime minister decided that statesmanlike was the only way to go.

The tone of grim realism made for an effective contrast with Boris Johnson's empty but entertaining optimism 24 hours before, the first task of a leader who is not loved by his party. Also rattled by Ed Miliband's one-nation pitch, the PM zoned in on lingering mistrust about the opposition's ability to steward public funds, and quipped that an instinct to answer every problem with a cheque made for "one-notion Labour". If that was two tasks which the speech acquitted, the third objective was to restore the Cameron stock of the character thing. This, too, was accomplished – through a measure of integrity. With the important exception of welfare, of which more in a moment, the PM did not fully embrace the white-van Conservatism which has been on show all week – bravely defending international aid, and forgoing the chance to bring the hall to its feet with some line about butchering a burglar. He has left it to others to do such dirty work, and so avoided finally burying his modernisation drive.

The greatest potential strength of the speech, however, was that it eschewed easy gimmicks, like the silly shares scheme George Osborne had insisted on pulling from his hat, in favour of a real argument. Unfortunately, this argument was badly awry – to the point where it became Mr Cameron's greatest failing. The presentation was solid, as was the framing about the changing balance of world power: he located Britain's challenges by looking outward, while Mr Miliband had turned in to concentrate on one nation alone. The problem was the substance – the tired claim that the slump was at heart a public debt crisis, as opposed to a wider malaise which excessive austerity has aggravated. Mr Cameron suggested that if it were not for the Osborne axe, we'd all be paying £1,000 a year more on our mortgages. That might have been true in a boom, but it is palpably false in a depressed global environment in which the big countries that have hung on to their own printing presses (think America, Japan) have discovered that investors' yearning for government paper allows them to spend without pushing up interest rates. Speaking in the same hall just before the election, Mr Cameron first revealed a deeply ideological reading of the crisis when he styled big government as its cause. Three years on – as a prime minister who has found out the hard way that the private sector will not magically fill the government gap – he sounded not merely dogmatic but deluded, as he reheated the argument in almost Tea Party terms: "We're here because they spent too much and borrowed too much."

Beyond the economy, he restricted himself to the two themes that No 10 hopes will shape election 2015 – schools and welfare. On the former, the PM mouthed a fervent faith that dismembering local education authorities through the academy programme will allow every school to do for its pupils what Eton did for him. Seeing as the LEAs are a mixed bunch, it seems unlikely that their withering will produce uniform improvement, even ignoring the financial squeeze. There is, by contrast, nothing mixed about the likely results of slashing social security. Mr Cameron caricatured claimants as living lavishly while others struggle, distorting reality by disregarding the millions who work and nonetheless rely on tax credits and housing benefit to make ends meet. The language was kinder than Peter Lilley's tirade against single mothers a generation ago, but the cuts are bigger today.

The focus groups suggest mileage in tapping middle England's resentment, but this is an agenda to cement Britain into two nations. Summoning the statesmanlike tone achieved on Wednesday will not be easy in future, should Britain fall prey to dogma and division.